4th Fiscal Period
Semi-Annual Reportfrom September 1, 2020 to February 28, 2021

SANKEI REAL ESTATE Inc.

Message to Our Unitholders
We would like to express our sincere appreciation to all unitholders for your loyal patronage to SANKEI REAL ESTATE Inc. (“SANKEI REALESTATE”).
Let us express our deepest sympathies to those who have been stricken with COVID-19 infections, related people and those affected by
the spread of the infection, as well as our sincere hope for their earliest possible recovery.
Having settled the 4th fiscal period ended February 2021, we are pleased to report on the performance results of SANKEI REAL ESTATE.
We would like to thank all of our unitholders for your continued support and cooperation.
SANKEI REAL ESTATE sets “office buildings,” located mainly in major metropolitan areas (Greater Tokyo, Osaka City and Nagoya City),
as its primary investment target. We also set “sub assets” as the secondary investment target in which we allocate a certain percentage
of investments, with an aim to build a strong portfolio that features both stability of earnings and growth potential. Sub assets are what wecollectively call the asset types that possess characteristics different from “office buildings” and contribute to the stability of the portfolio
revenue. Under the strong support of The Sankei Building Co., Ltd., our sponsor, we are poised to build a high-quality portfolio of properties.
In the 4th fiscal period ended February 2021, we made external growth by acquiring S-GATE AKASAKA, which was developed as the first
property of the “S-Gate” high-grade, mid-sized office building series proactively promoted by the sponsor in Central Tokyo. As for internal
growth, we continued to raise rents upon contract renewals even amid the COVID-19 pandemic. These two drivers of growth proved effective,
enabling SANKEI REAL ESTATE to achieve an increase in revenue and income both from the forecast and from the previous fiscal period
results. As a result, we successfully delivered distribution per unit of 2,849 yen, up 6.5% from forecast and up 12.5% period-on-period.
As for forecast distribution per unit for the 5th fiscal period ending August 2021, we anticipate 2,862 yen, up 0.5% from the 4th fiscal
period ended February 2021, as the achievements in external growth and internal growth we made in the 4th fiscal period will contribute
throughout the period. For the 6th fiscal period ending February 2022, we expect distribution per unit to be 2,720 yen, down 5.0% from theforecast for the 5th fiscal period, considering the impact of contract cancellations by tenants. In spite of this, we will endeavor to achieve
better results than the forecast.
The impact of the COVID-19 pandemic on social and economic activities in and outside Japan continues to require attention. While working
to discern the trends of the economy and the financial and capital markets going forward, we will securely implement the growth strategy
envisioned by SANKEI REAL ESTATE and do our best endeavors to maximize unitholders’ value.
We ask you, our unitholders, to extend to us your continued consideration and support of our operations for many years.
Yuichi Ota
Executive Director, SANKEI REAL ESTATE Inc.
President and Representative Director, Sankei Building Asset Management Co., Ltd.

I. Asset Management Report
1. Overview of Asset Management(1) Changes in operating results and other management data
Fiscal period
Closing of accounts
Operating revenue[Operating revenue from real estate leasing]Operating expenses[Operating expenses from real estate leasing]Operating income
Ordinary income
Net income
Unitholders’ capital
Total number of investment units issued and outstanding
Net assets[Period-on-period change]
Total assets[Period-on-period change]
Total interest-bearing liabilities
Net assets per unit (Note 4)
Net income per unit (Note 3)
Total distribution
Distribution per unit
[Distribution of net income per unit][Distribution in excess of net income per unit]
Ratio of ordinary income to total assets (Note 4)
Annualized (Note 5)
Return on equity (Note 4)
Annualized (Note 5)
Equity ratio (Note 4)[Period-on-period change]
Payout ratio (Note 4)

million yen
million yen
million yen
million yen
million yen
million yen
million yen
million yen
units
million yen%
million yen%
million yenyenyen
million yen
yen
yen
yen
%
%
%
%
%
%
%

1st fiscal period
August 2019
1,157
[1,157]
457
[315]
699
336
335
23,124
239,600
23,460[－]48,718[－]22,313
97,913
2,312
335
1,399
[1,399]
[－]
0.7
[1.4]
1.5
[2.9]
48.2
[－]
100.0

2nd fiscal period
February 2020
1,933
[1,933]
767
[577]
1,166
1,069
1,068
36,540356,800
37,609[60.3]
76,186[56.4]
33,956
105,408
3,007
1,068
2,995
[2,995]
[－]
1.7
[3.4]
3.5
[7.0]
49.4
[1.2]
100.0

3rd fiscal period
August 2020
2,005
[2,005]
1,009
[778]
996
904
903
36,540356,800
37,444[(0.4)]
76,195[0.0]
33,500104,945
2,532
903
2,532
[2,532]
[－]
1.2
[2.4]
2.4
[4.8]
49.1
[(0.3)]
100.0

4th fiscal period
February 2021
2,147
[2,147]
1,029
[790]
1,118
1,017
1,016
36,540356,800
37,557[0.3]
79,482[4.3]
37,800105,262
2,849
1,016
2,849
[2,849]
[－]
1.3
[2.6]
2.7
[5.4]
47.3
[(1.8)]
100.0

days
properties
million yen
million yen
million yen
million yen
yen

173
8
123
25
966
459
1,916

182
11
215
69
1,571
1,284
3,600

184
11
219
54
1,446
1,122
3,147

181
12
227
42
1,585
1,243
3,485

%

45.8

44.6

44.0

47.6

[Other reference information]
Days of operation (Note 1)
Number of investment properties at end of period
Depreciation
Capital expenditures
Leasing NOI (Net Operating Income) (Note 4)
FFO (Funds from Operation) (Note 4)
FFO per unit (Note 4)
Ratio of interest-bearing liabilities to total assets at endof period (LTV) (Note 4)(Note 1) The calculation period for the first fiscal period of SANKEI REAL ESTATE Inc. (“SANKEI REAL ESTATE”) was 286 days from November 19, 2018 to August 31, 2019, but theactual asset management period was 173 days from March 12, 2019.
(Note 2) Consumption tax is not included in operating revenue, etc.
(Note 3) Net income per unit is calculated by dividing net income by daily weighted average number of investment units (1st fiscal period: 144,970 units, 2nd fiscal period: 355,420 units,
3rd fiscal period: 356,800 units and 4th fiscal period: 356,800 units). In the meantime, net income per unit for the 1st fiscal period is 1,410 yen if calculated by deeming March
12, 2019, when actual asset management started, as the beginning of the period and using daily weighted average number of investment units (237,695 units).
(Note 4) The indicators are calculated by using the following formulas. Furthermore, as actual asset management for the 1st fiscal period started on March 12, 2019, the ratio of ordinary
income to total assets and return on equity have been calculated by deeming the said date as the beginning of the period.
Net assets per unit

Net assets ÷ total number of investment units issued and outstanding

Ratio of ordinary income to total assets

Ordinary income ÷ [(total assets at beginning of period + total assets at end of period) ÷ 2] × 100

Return on equity

Net income ÷ [(net assets at beginning of period + net assets at end of period) ÷ 2] × 100

Equity ratio

Net assets at end of period ÷ total assets at end of period × 100

Payout ratio

Distribution per unit (excluding distribution in excess of income) ÷ net income per unit × 100
The payout ratio for the 1st fiscal period and the 2nd fiscal period is calculated by the following formula, as the number of investment
units during the period changed due to issuance of new investment units in the period:
Total distribution (excluding distribution in excess of earnings) ÷ net income × 100

Leasing NOI (Net Operating Income)Operating revenue from real estate leasing - operating expenses from real estate leasing + depreciation

FFO (Funds from Operation)

Net income + depreciation - gain or loss on sale of real estate

FFO per unit

FFO ÷ total number of investment units issued and outstanding

Ratio of interest-bearing liabilities to total
assets at end of period (LTV)

Balance of interest-bearing liabilities at end of period ÷ total assets at end of period × 100(Note 5) For the 1st fiscal period, annualized figures are calculated based on the practical days of operation (173 days from March 12, 2019 to August 31, 2019).
(Note 6) Unless otherwise stated, the figures less than the specified unit are rounded down for monetary amounts and rounded off to the nearest specified unit forpercentage figures in this Report.

1(2) Asset management review for the 4th fiscal period
1) Brief History of the Investment Corporation
SANKEI REAL ESTATE was incorporated under the Act on Investment Trusts and Investment Corporations (Act No. 198 of 1951, as amended;hereinafter, the “Investment Trusts Act”) with Sankei Building Asset Management Co., Ltd. (hereinafter, the “Asset Management Company”) as theorganizer and investments in capital of 100 million yen (1,000 units) on November 19, 2018, and completed the registration with the Kanto Local Finance
Bureau pursuant to Article 187 of the Investment Trusts Act on December 17, 2018 (Registration No. 140 with the Director-General of the Kanto Local
Finance Bureau). Later, SANKEI REAL ESTATE was listed on the Real Estate Investment Trust Securities Market of Tokyo Stock Exchange, Inc.
(hereinafter, the Tokyo Stock Exchange”) on March 12, 2019 (TSE code: 2972).
As of the last day of the fiscal period under review (February 28, 2021), the total number of investment units issued and outstanding was 356,800
units, and unitholders’ capital was 36,540 million yen.

2) Management Environment
In the fiscal period under review (fiscal period ended February 2021), the Japanese economy showed movements of picking up with the raising of
the level of social and economic activities while taking measures to prevent the spread of COVID-19. However, the rapid increase in the number ofconfirmed cases of COVID-19 in Japan led to re-declaration of a state of emergency based on the Act on Special Measures for Pandemic Influenza andNew Infectious Diseases Preparedness and Response (Act No. 31 of 2012, as amended) on January 7, 2021, that covered 11 prefectures at one point.
This, among other factors, made it an environment in which economic developments continued to require attention. In overseas economies, too,
the economy in some regions showed movements of picking up, but there were also regions where economic activities were constrained due to the
spread of COVID-19, continuing to be an environment with downside risks.
Under such economic circumstances, in terms of the office building market, which SANKEI REAL ESTATE sets as the primary
investment target, contract cancellations stemming from COVID-19 were limited, but there were movements of office relocations
being cancelled and contract cancellations associated with consolidation of bases, etc. with the progress in remote working such as working
from home. Even in Tokyo and Osaka, where SANKEI REAL ESTATE’s portfolio assets are located, vacancy rates continued to
be on the rise and rent levels also showed weak developments. In terms of the hotel market, in which SANKEI REAL ESTATE
invests as sub-assets, the substantial decrease in the number of international visitors to Japan continued due to restrictions on entry into
Japan. Meanwhile, domestic travel showed even trends of improvement in the total number of overnight guests and room occupancy rates
according to the Overnight Travel Statistics Survey by the Japan Tourism Agency due in part to the government’s Go To Travel campaign, but took
a downward turn again as the Go To Travel campaign was temporarily suspended due to the spread of COVID-19.

3) Management Performance
In the management environment described above, SANKEI REAL ESTATE acquired 1 property (S-GATE AKASAKA) on October 1, 2020, at an acquisition price of 4,200 million yen using loans. As a result, the portfolio of SANKEI REAL ESTATE as of the last day of the fiscal period under review
consisted of 12 properties with an asset size (total acquisition price) of 71,525 million yen.
SANKEI REAL ESTATE has sought to improve tenant satisfaction through reinforcement and enhancement of the relationship with existing tenants,
aiming at expansion of revenue and stable growth of earnings from assets under management. For existing tenants approachingc ontrac t renewal, contract renewals managed to be made with upward revision or no change in rent for most tenants
despite the COVID -19 pandemic through ef for ts based on trends of the rental mar ket. Even for the vac ancy that arose at the
beginning of the fiscal period under review, agile leasing activities proved effective in managing to secure a new tenant to move induring the fiscal period under review. In addition, repairs and capital expenditures were narrowed down to those that contribute tomaintenance and improvement of the competitiveness of the assets under management. On the other hand, there are movements ofconsolidation of bases, mainly among companies based in several locations, and notices of contract cancellation and such associated withconsolidation of bases have been received from some tenants even at the assets under management of SANKEI REAL ESTATE, but there is no
impact on management performance in the fiscal period under review.
As a result, the occupancy rate (Note) of the 12 portfolio properties as of the last day of the fiscal period under review remained high at 99.9%, andoperating revenue from real estate leasing was 2,147 million yen, 7.1% higher than that at the end of the previous fiscal period despite the COVID-19
pandemic. The appraisal value as of the last day of the fiscal period under review was 79,181 million yen.
SANKEI REAL ESTATE received requests for rent decrease, deferment of rent payment, etc. due to COVID-19 from some tenants, mainly retailtenants occupying portions of office buildings that are assets under management, but the impact on management performance in the fiscal period
under review is minimal because the assets under management are mainly office buildings. In addition, although the two hotel properties held by
SANKEI REAL ESTATE saw impact associated with the spread of COVID-19, fixed rent based on the current contract has been secured as usual for
rent business revenue in the fiscal period under review.
(Note) “Occupancy rate” is the ratio of total leased area to total leasable area, rounded to one decimal place. Moreover, for total leasable area and total leased area,
each total is calculated based on the area corresponding to SANKEI REAL ESTATE’s ownership interest in each portfolio property.

4) Overview of Fund Procurement
In the fiscal period under review, 4,300 million yen was borrowed from Mizuho Bank, Ltd. on October 1, 2020, in conjunction with the acquisition of
1 property (S-GATE AKASAKA) on October 1, 2020.
As a result, as of the last day of the fiscal period under review, the balance of loans outstanding was 37,800 million yen and the ratio ofinterest-bearing liabilities to total assets (hereinafter, “LTV ratio”) was 47.6%.
25) Overview of Business Performance and Distribution
As a result of the management described above, business performance in the fiscal period under review was operating revenue of 2,147
million yen, operating income of 1,118 million yen, ordinary income of 1,017 million yen, and net income of 1,016 million yen. Concerning
distribution, in accordance with SANKEI REAL ESTATE’s distribution policy (Article 36 of the articles of incorporation), SANKEIREAL ESTATE intends to have the maximum amount of distribution of earnings included in deductible expenses by applicationof special provisions for taxation on investment corporations (Article 67-15 of the Act on Special Measures Concerning Taxation(Act No. 26 of 1957, as amended)). For the fiscal period under review, the decision was made to distribute 1,016,523,200 yen,which is the entire amount of unappropriated retained earnings, excluding fractions of distribution per unit of less than 1 yen. This
resulted in distribution per unit of 2,849 yen.

(3) Capital increases
Changes in the total number of investment units issued and outstanding and unitholders’ capital from the incorporation of SANKEI REAL ESTATE to
the last day of the fiscal period under review (February 28, 2021) are as follows:
Date

Total number of investment units
issued and outstanding (units)
Increase
Balance(Decrease)

Description

Nov. 19, 2018
Mar. 11, 2019

Incorporation
through private placement
Capital increase through public
offering

Unitholders’ capital (million yen)
Increase(Decrease)

Balance

Remarks

1,000

1,000

100

100

(Note 1)

227,238

228,238

21,92822,028(Note 2)

Apr. 10, 2019

Capital increase through third-party allotment

11,362

239,600

1,096

23,124(Note 3)

Sep. 2, 2019

Capital increase through public
offering

111,619

351,219

12,77735,902(Note 4)

Sep. 26, 2019

Capital increase through third-party allotment

5,581

356,800

638

36,540(Note 5)(Note 1) Investment units were issued at a paid-in amount of 100,000 yen per unit upon the incorporation of SANKEI REAL ESTATE.
(Note 2) New investment units were issued through public offering at an issue price of 100,000 yen (paid-in amount of 96,500 yen) per unit for the purpose of procuring funds
for acquisition of new properties.
(Note 3) New investment units were issued through third-party allotment accompanying the capital increase through public offering at a paid-in amount of 96,500 yen per unit.
(Note 4) New investment units were issued through public offering at an issue price of 118,734 yen (paid-in amount of 114,471 yen) per unit for the purpose of procuring funds
for acquisition of new properties.
(Note 5) New investment units were issued through third-party allotment accompanying the capital increase through public offering at a paid-in amount of 114,471 yen per unit.

[Changes in market price of investment certificates]
The highest and lowest (closing price) market prices on the Real Estate Investment Trust Securities Market of the Tokyo Stock Exchange,on which SANKEI REAL ESTATE’s investment certificates are listed, in each fiscal period are as follows:
Fiscal period

1st fiscal period

2nd fiscal period

3rd fiscal period

4th fiscal period

Highest (yen)126,000

139,300

127,600

117,400

Lowest (yen)100,500

116,500

66,90090,100(Note) SANKEI REAL ESTATE’s investment certificates were listed on the Real Estate Investment Trust Securities Market of the Tokyo Stock Exchange on March 12, 2019.

3

(4) Performance of distribution, etc.
Concerning distribution for the fiscal period under review, SANKEI REAL ESTATE decided to distribute the entire amount of unappropriated retained
earnings, excluding fractions of distribution per unit of less than 1 yen, with the intent of having the maximum amount of distribution of earnings included
in deductible expenses by application of special provisions for taxation on investment corporations (Article 67-15 of the Act on Special Measures
Concerning Taxation). This resulted in distribution per unit of 2,849 yen.

Fiscal period

1st fiscal period

2nd fiscal period

3rd fiscal period

4th fiscal periodBusiness period

From Nov. 19, 2018
to Aug. 31, 2019

From Sep. 1, 2019
to Feb. 29, 2020

From Mar. 1, 2020
to Aug. 31, 2020

From Sep. 1, 2020
to Feb. 28, 2021

335,209

1,068,783

Total unappropriated retained earnings(thousand yen)

Retained earnings(thousand yen)

8

167

207

210

Total cash distributions(thousand yen)335,200

1,068,616

903,417

1,016,523[Distribution per unit][Total distribution of earnings][Distribution of net income per unit]

903,625

1,016,734(yen)[1,399][2,995][2,532][2,849](thousand yen)335,200

1,068,616

903,417

1,016,523(yen)[1,399][2,995][2,532][2,849](thousand yen)

－

－

－

－

(yen)

[－]

[－]

[－]

[－]

(thousand yen)

－

－

－

－

[Of the contribution refund per unit, distribution per unit of thereserve for temporary difference adjustments]

(yen)

[－]

[－]

[－]

[－]

Of the total contribution refund, distribution through the
reduction in unitholders’ capital for tax purposes(thousand yen)

－

－

－

－

[Of the contribution refund per unit, distribution per unit
through the reduction in unitholders’ capital for tax purposes]

(yen)

[－]

[－]

[－]

[－]

[Total contribution refund][Contribution refund per unit]
Of the total contribution refund, distribution of thereserve for temporary difference adjustments(Note) Amounts are rounded down to the nearest unit.

(5) Future asset management policy and issues to be addressed
General Management Outlook
COVID-19 continues to impact social and economic activities in Japan and abroad. Although the spread of COVID-19 is expected to slow with progress in vaccinations ahead, there is no guarantee that it will lead to containment. As such, the environment will likely continue to be one in which
downside risks to the Japanese and overseas economies, the impact on fluctuations in the financial and capital markets, etc. warrant close attention.
In terms of the office building market, vacancy rates are rising in the COVID-19 pandemic, and rents have also started to appear to peak or trend
toward decrease in market rates. In addition, it is necessary to pay close attention to changes in work styles and the trend of office demand in socialand economic activities. At SANKEI REAL ESTATE, too, progress in consolidation of bases and reduction of office space due to the expansion of remote working such as working from home could lead to lease contract cancellations arising. We will further reinforce the relationship with tenants andcontinue consultations and responses as required, while closely monitoring tenants’ business performance, etc.
In terms of the hotel market, recovery in the number of international visitors to Japan looking unlikely and also domes tic travelers and business travelers still in low numbers suggest the severe situation will continue for a while yet. A severe operating environment is foreseen for also the two hotel properties held by SANKEI REAL ESTATE, but no impact on SANKEIREAL ESTATE is expected as GRANVISTA Hotels & Resorts Co., Ltd., which is a tenant of the two properties and a whol ly owned s ubsidiary of SANKEI REAL ESTATE’s sp o n so r, Th e S a n ke i B u ild in g C o . , L t d . (h e re in a f t e r, “S a n ke i B u il d i n g ” o r“Sponsor”), continues to pay fixed rent based on the fixed-term building lease agreement.

1) External Growth Strategy
While carefully assessing the economic impact of the spread of COVID-19, the real estate investment market conditions, and other factors, SANKEIREAL ESTATE will continue to maintain external growth through acquisition of Sankei Building’s portfolio properties as well as properties held by third
parties by leveraging the sourcing capabilities of Sankei Building through sponsorship support.

42) Internal Growth Strategy
SANKEI REAL ESTATE aims for steady internal growth through reinforcement of the relationship with existing tenants and improvementin tenant satisfaction. Specifically, we will raise rents when upon contract renewal based on the deviation from market rent and implement
strategic leasing such as activities to extend the cancellation notification period from tenants and disperse end dates of rental contracts from the viewpoint of termination risk for properties where the end dates of multiple tenants are the same. We will take proactive
measures to improve tenant satisfaction such as activities to improve the quality of hygiene and planned implementation ofmaintenance and repairs under the COVID-19 pandemic.
SANKEI REAL ESTATE will utilize the Sankei Building Group’s comprehensive operation and management functions ranging fromreal estate planning and development to lease-up, operation, and management through collaboration within the Sankei Building Group
with Sankei Building at the core.
In addition, SANKEI REAL ESTATE will execute the following measures, etc. to aim for greater revenue and stable growth of earnings
from assets under management.
(a) Strive to provide services for tenants’ comfortable use while strengthening and enhancing tenant relationships in order to maintainand improve tenant satisfaction so as to maintain and improve the occupancy rate and rent of assets under management.
(b) Seek to maintain and improve the market competitiveness of assets under management through planning and implementation of
repairs and capital expenditures by taking into consideration the state and characteristics of assets under management, real estatemarket conditions, tenant needs, and other factors and examining them more carefully than usual.
(c) Strive to maintain and improve earnings by conducting agile leasing activities with a continual grasp of leasing market trends.
(d) Adopt ongoing initiatives to reduce operating and management costs and consider the environment by periodically verifying thevalidity of operations, management level, and costs of assets under management. In doing so, the balance with the market competitiveness of assets under management and perspective of maintaining and improving tenant satisfaction are taken into consideration.

3) Financial Strategy
SANKEI REAL ESTATE will conduct appropriate and sound financial management while considering agility of financing activities,
stability of cash flows, and other matters in order to secure stable earnings and steady growth of assets under management over the
medium to long term.
In addition, to secure financial soundness, the basic policy shall be to set the upper limit for the LTV ratio at 60% in principle (however,the LTV ratio may temporarily exceed the range of the upper limit for the LTV ratio for the purpose of new asset acquisition, etc.). As arule, SANKEI REAL ESTATE will maintain an approximate range of 40% to 50% during normal operations.
(a) Equity financing
Issuance of new investment units shall be in an agile manner with due consideration to investment unit dilution, while also comprehensively taking into account capital market trends, financial environment, timing of acquisition of real estate, etc. to be newly acquired,ratio of interest-bearing liabilities to total assets and other factors.
(b) Debt financing
Upon borrowing, etc., fund procurement shall be executed in an appropriate manner by taking into account the balance
between interest rate trends, market levels, financial agility, long-term business relationships, and security, and by considering theborrowing period, fixed or floating interest rate, provision of collateral or not, fees, and other terms and conditions of procurement ofinterest-bearing liabilities.
The 4,800 million yen of long-term loans due for repayment on March 12, 2021, was refinanced through a loan syndicate with
Mizuho Bank, Ltd. and Sumitomo Mitsui Banking Corporation as the arrangers on March 12, 2021. The borrowing was made witha borrowing period of 4 years and fixed interest rate, thereby promoting extension of the average time to maturity, improvement in
the ratio of fixed-rate debt, and staggering of maturities of interest-bearing liabilities.

(6) Significant Subsequent Events
Not applicable.

52. Overview of the Investment Corporation(1) Summary of unitholders’ capital
1st fiscal period(as of Aug. 31, 2019)

2nd fiscal period(as of Feb. 29, 2020)

3rd fiscal period(as of Aug. 31, 2020)

4th fiscal period(as of Feb. 28, 2021)(units)

10,000,000

10,000,000

10,000,000

10,000,000(units)239,600

356,800

356,800

356,800

Unitholders’ capital(million yen)

23,12436,54036,54036,540

Number of unitholders(persons)

6,626

7,848

7,725

7,682

Total number of investment
units authorized
Total number of investment
units issued and outstanding(2) Matters related to investment units
The following table shows the major unitholders (Note 1) of SANKEI REAL ESTATE as of February 28, 2021.
Number of investment units
held(units)Name

Ratio to the total numberof investment units issued
and outstanding(%) (Note 2)

The Master Trust Bank of Japan, Ltd. (Trust Account)

72,506

20.32

Custody Bank of Japan, Ltd. (Trust Account)

67,33818.87

The Nomura Trust and Banking Co., Ltd. (Investment Trust Account)

25,131

7.04

The Sankei Building Co., Ltd.

17,479

4.89

Custody Bank of Japan, Ltd. (Securities Investment Trust Account)

16,263

4.55

BNP PARIBAS SECURITIES SERVICES LUXEMBOURG/JASDEC/SECURITIES-AIFM

12,683

3.55

STATE STREET BANK AND TRUST COMPANY 505223

6,505

1.82

Aozora Bank, Ltd.

6,102

1.71

SCBHK AC LIECHTENSTEINISCHE LANDESBANK AG

5,727

1.60

The Bank of Yokohama, Ltd.

5,353

1.50

235,087

65.88

Total

(Note 1) “Major unitholders” refers to the ten largest entities among the unitholders according to the ratio of their investment units held to the total number of investment units
issued and outstanding.
(Note 2) Ratio to the total number of investment units issued and outstanding is rounded down to the two decimal places.

6(3) Matters related to directors
The following table shows the directors, etc. of SANKEI REAL ESTATE as of February 28, 2021.

Position
Executive
Director

Name

Yuichi Ota

President and Representative Director, Sankei Building Asset Management Co., Ltd.

Susumu Motoyoshi
Supervisory
Director
Financial
Auditor

Total remuneration foreach position during theperiod under review(thousand yen)

Major concurrent assignments

Representative, Motoyoshi Total Accounting Office

1,800

Partner, Utsunomiya Shimizu & Haruki

Kohmei Shimizu

1,800

Adjunct Professor, Hosei University Law School－

Ernst & Young ShinNihon LLC

－

8,400

(Note 1) None of the Executive Director or Supervisory Directors own investment units in SANKEI REAL ESTATE, either in their own name or in someone else’s name. Moreover,although they may be officers of corporations other than those mentioned above, they have no conflict of interest with SANKEI REAL ESTATE at those and the above positions.
(Note 2) The remuneration for the Executive Director and Supervisory Directors are the amounts paid to them in the 4th fiscal period, and the remuneration to the Financial Auditor is theamount payable to it for audits pertaining to the 4th fiscal period.
(Note 3) The dismissal of the Financial Auditor shall be considered in accordance with the provisions of the Investment Trusts Act. The decision to not reappoint the Financial Auditor
shall be studied at SANKEI REAL ESTATE’s Board of Directors by comprehensively considering the audit quality, audit fee and other various conditions.
(Note 4) The term of office of each of the Executive Director and Supervisory Directors ended on November 19, 2020, and all of them were re-elected at the General Meeting of Unitholders
held on November 18, 2020.
(Note 5) In preparation for the event of the Executive Director or Supervisory Directors failing to remain in office or their number falling below what is set forth by laws and regulations,
Atsushi Mukai was appointed as Substitute Executive Director and Kanae Fukushima was appointed as Substitute Supervisory Director at the General Meeting of Unitholders
mentioned above.

(4) Asset management company, asset custodian and administrative agentsThe following are the asset management company, asset custodian and administrative agents of SANKEI REAL ESTATE as of February 28, 2021.

Entrustment category

Name

Asset management company

Sankei Building Asset Management Co., Ltd.

Asset custodian

Sumitomo Mitsui Trust Bank Limited

Administrative agent (unitholder register administrator)

Mizuho Trust & Banking Co., Ltd.

Administrative agent (operation of administrative instruments)

Mizuho Trust & Banking Co., Ltd.

Administrative agent (accounting, bookkeeping, taxes)

Reiwakaikeisha Tax Corporation (Note)(Note) The entrusted company for accounting and bookkeeping operations was changed from Reiwakaikeisha Tax Corporation to Reiwa Accounting Holdings Co., Ltd.
as of March 1, 2021. Reiwakaikeisha Tax Corporation, which had been entrusted with these services, continues to be entrusted with tax operations.

73. Status of Asset under Management of the Investment Corporation(1) SANKEI REAL ESTATE’s asset structure
Asset
group

3rd fiscal period(as of Aug. 31, 2020)

Geographic area
(Note 1)

Total amountheld(million yen)
(Note 2)

As a percentage
of total assets

2,614

Cities designated by government ordinance(excluding above), core cities and major regional cities

As a percentage
of total assets(%) (Note 3)

Total amountheld(million yen)
(Note 2)

3.4

2,612

3.3

－

－

－

－

Greater Tokyo, Osaka City and Nagoya City

－

－

－

－

Cities designated by government ordinance(excluding above), core cities and major regional cities

－

－

－

－

52,60269.0

56,728

71.4

－

－

－

－

Greater Tokyo, Osaka City and Nagoya City

9,031

11.9

9,004

11.3

Cities designated by government ordinance(excluding above), core cities and major regional cities

4,000

5.3

3,974

5.0

Greater Tokyo, Osaka City and Nagoya City

9,031

11.9

9,004

11.3

Cities designated by government ordinance(excluding above), core cities and major regional cities

4,000

5.3

3,974

5.0

Subtotal

68,24989.6

72,320

91.0

Deposits and other assets

7,945

10.4

7,162

9.0

Total assets

76,195100.0

79,482100.0

Asset type

Greater Tokyo, Osaka City and Nagoya City
Office buildingsRealestateSub assets

Greater Tokyo, Osaka City and Nagoya City
Office buildingsRealestate intrust

Sub assets

Hotels

4th fiscal period(as of Feb. 28, 2021)

Cities designated by government ordinance(excluding above), core cities and major regional cities(%) (Note 3)(Note 1) “Greater Tokyo” refers to Tokyo, Kanagawa Prefecture, Saitama Prefecture and Chiba Prefecture.
“Core cities” refers to cities with population of 200,000 or more (excluding Greater Tokyo, Osaka City and Nagoya City, and other cities designated by government ordinance).
“Major regional cities” refers to cities that are municipalities with population of less than 200,000 and the Asset Management Company has deemed certain demand can befound for specific asset types.
(Note 2) “Total amount held” is based on the carrying amount (in the case of real estate and real estate in trust, the depreciated book value), rounded down to the nearest million yen.
Furthermore, the total amount held for real estate in trust with hotel as the asset type includes the book value of movables incidental to hotels.
(Note 3) “As a percentage of total assets” is rounded to one decimal place.

8

(2) Major assets held
The following is an overview of the major assets (top ten properties on a book value basis) held by SANKEI REAL ESTATE as ofFebruary 28, 2021.
Total leasable
area
(m2)
(Note 2)

Ratio to total
rent businessrevenue (%)(Note 3)

Total leased
area
(m2)
(Note 2)

Occupancy rate(%)
(Note 2)

12,146.02

12,146.02

100.0

24.7

Office buildings

10,132Not disclosed(Note 5)

Not disclosed(Note 5)100.0

Not disclosed(Note 5)

Office buildings

9,004

6,006.53

6,006.53

100.0

9.6

Property nameBook value(million yen)
(Note 1)BREEZÉ TOWER (Note 4)

13,130Shinagawa Seaside TS Tower (Note 4)
Hotel Intergate Tokyo Kyobashi

Main use

HotelsS-GATE NIHONBASHI-HONCHO (Note 4)

6,725

3,171.83

3,171.83

100.0

7.5

Office buildings

Hibiya Sankei Building

6,051

3,439.61

3,439.61

100.0

9.8

Office buildings

Omori Park Building

5,477

7,469.72

7,469.72

100.0

7.2

Office buildings

Hatchobori Sankei Building

5,020

5,594.90

5,594.90

100.0

8.2

Office buildings

S-GATE AKASAKA (Note 4)

4,249

1,984.86

1,984.86

100.0

Not disclosed(Note 5)

Office buildings

Hotel Intergate Hiroshima

3,974

9,160.15

9,160.15

100.0

5.5

HotelsToyo Park Building

3,881

4,224.52

4,224.52

100.0

5.4

Office buildings

67,649Not disclosed(Note 5)

Not disclosed(Note 5)

100.0

94.3

－

Total

(Note 1) “Book value” is the depreciated book value for each portfolio asset as of February 28, 2021, rounded down to the nearest million yen. The same shall apply hereinafter.
(Note 2) Figures for “total leasable area,” “total leased area” and “occupancy rate” are based on the data as of February 28, 2021. Furthermore, “total leasable area” is the area (excludingarea of warehouse, signboard, parking lot, etc.) expected to be leasable based on the lease agreement, drawing, etc. of the buildings for each portfolio asset, rounded down
to two decimal places. “Total leased area” is the total leased area (excluding area of warehouse, signboard, parking lot, etc.) stated in the lease agreement (excluding leased
agreements under which the lease period is yet to commence) for each portfolio asset, rounded down to two decimal places. With respect to the portion which comes under the
pass-through-type master lease agreement, the total area for which the lease agreement has actually been concluded with the end tenant and for which the lease period hascommenced is indicated, rounded down to two decimal places. “Occupancy rate” is the ratio of total leased area to total leasable area for each portfolio asset, rounded to one
decimal place. In addition, “occupancy rate” in the portfolio total column is the ratio of the sum total of total leased area to the sum total of total leasable area for each portfolio
asset, rounded to one decimal place. The same shall apply for occupancy rate hereinafter.
(Note 3) “Ratio to total rent business revenue” is rounded to one decimal place. The same shall apply hereinafter.
(Note 4) The book value, total leasable area and total leased area are the figures equivalent to the co-ownership interest (51% for “S-GATE NIHONBASHI-HONCHO”) and the quasi
co-ownership interest (45% for “BREEZÉ TOWER,” 25% for “Shinagawa Seaside TS Tower” and 60% for “S-GATE AKASAKA”) held by SANKEI REAL ESTATE.
(Note 5) Not disclosed, due to unavoidable circumstances in that such contains information for which consent for disclosure has not been obtained from the tenant, relevant party, etc. or
information from which confidential information can be derived.

9

(3) Real estate assets in the portfolio
The following table shows the overview of the assets held by SANKEI REAL ESTATE as of February 28, 2021.
Property nameTokyo Sankei Building (Note 3)

Form of ownership(Note 1)

Location
1-7-2 Otemachi, Chiyoda-ku, TokyoBREEZÉ TOWER (Note 3)

2-4-9 Umeda, Kita-ku, Osaka-shi, Osaka

S-GATE NIHONBASHI-HONCHO (Note 3)

1-9-1 Nihonbashi-Honcho, Chuo-ku, Tokyo

S-GATE AKIHABARA

2-4-6 Higashi-Kanda, Chiyoda-ku, Tokyo

Hibiya Sankei Building

1-9-1 Yurakucho, Chiyoda-ku, Tokyo

Hatchobori Sankei Building

2-7-1 Hatchobori, Chuo-ku, Tokyo

Toyo Park Building

5-29-17 Toyo, Koto-ku, Tokyo

Shinagawa Seaside TS Tower(Note 3)4-12-3 Higashi-Shinagawa, Shinagawa-ku,
Tokyo

Omori Park Building

1-6-1 Omori-Honcho, Ota-ku, Tokyo

S-GATE AKASAKA (Note 3)

6-2-4 Akasaka, Minato-ku, Tokyo

Hotel Intergate Tokyo Kyobashi

3-7-8 Kyobashi, Chuo-ku, Tokyo

Hotel Intergate Hiroshima

5-16 Teppocho, Naka-ku, Hiroshima-shi, Hiroshima
Total

Real estate
Real estate trust
beneficiary rightReal estate trust
beneficiary rightReal estate trust
beneficiary rightReal estate trust
beneficiary rightReal estate trust
beneficiary rightReal estate trust
beneficiary rightReal estate trust
beneficiary rightReal estate trust
beneficiary rightReal estate trust
beneficiary rightReal estate trust
beneficiary rightReal estate trust
beneficiary right

Period-end
appraisal value(million yen)
(Note 2)

Book value(million yen)

2,690

2,612

17,235

13,130

7,470

6,725

2,530

2,059

6,340

6,051

5,500

5,020

3,610

3,881

11,000

10,132

5,490

5,477

4,266

4,249

8,970

9,004

4,080

3,974

79,181

72,320(Note 1) “Real estate trust beneficiary right” refers to trust beneficiary right that has real estate as main trust assets.
(Note 2) “Period-end appraisal value” indicates the appraisal value or the price in the price survey that is conducted using the method similar to that used by real estate appraisers, withthe last day of the fiscal period as the survey date, based on SANKEI REAL ESTATE’s articles of incorporation and the “Regulations on calculations of investment corporations”(Cabinet Office Order No. 47 of 2006, as amended).
(Note 3) The period-end appraisal value and book value are the figures equivalent to the co-ownership interest (2% for “Tokyo Sankei Building” and 51% for “S-GATE NIHONBASHI-HONCHO”)
and the quasi co-ownership interest (45% for “BREEZÉ TOWER,” 25% for “Shinagawa Seaside TS Tower” and 60% for “S-GATE AKASAKA”) held by SANKEI REAL ESTATE.

The following table shows the overview of the rent business for each of the assets under management held by SANKEI REAL ESTATE.
4th fiscal period
3rd fiscal period
From Sep. 1, 2020
From Mar. 1, 2020
to Feb. 28, 2021
to Aug. 31, 2020
OperatingOperatingrevenue fromrevenue from
Property name
Occupancy
Number of
Number of ten- Occupancy
Ratio to total
real estate
Ratio to total
real estaterate
tenants (atrateants (at period
rent businessleasing
rent businessleasing
period end) (at period end)
(at period end)
end)
(during period) revenue (%)(during period) revenue (%)(%)(Note 1)(%)
(Note 1)(million yen)(million yen)
(Note 2)
(Note 2)
Tokyo Sankei Building
47
100.0
58
2.9
45
91.6
60
2.8
BREEZÉ TOWER
38
100.0
496
24.8
38
100.0
531
24.7
S-GATE NIHONBASHI-HONCHO
3
100.0
149
7.4
3
100.0
160
7.5
S-GATE AKIHABARA
5
100.0
58
2.9
6
100.0
62
2.9
Hibiya Sankei Building
11
100.0
209
10.4
11
100.0
209
9.8
Hatchobori Sankei Building
10
100.0
178
8.9
10
100.0
176
8.2
Toyo Park Building
5
100.0
108
5.4
5
100.0
115
5.4
Not disclosed
Not disclosed Not disclosed Not disclosed
Not disclosed Not disclosed
Shinagawa Seaside TS Tower
100.0
100.0
(Note 3)(Note 3)(Note 3)(Note 3)(Note 3)(Note 3)
Omori Park Building
8
100.0
166
8.3
9
100.0
154
7.2
Not disclosed Not disclosed
S-GATE AKASAKA
2
100.0
－
－
－
－
(Note 3)(Note 3)
Hotel Intergate Tokyo Kyobashi
1
100.0
206
10.3
1
100.0
206
9.6
Hotel Intergate Hiroshima
1
100.0
118
5.9
1
100.0
118
5.5
Not disclosed
Not disclosed Not disclosed Not disclosed
Total
100.0
99.9
2,147
100.0
(Note 3)(Note 3)(Note 3)(Note 3)(Note 1) “Number of tenants” indicates the total number of tenants of the respective portfolio assets held as of February 28, 2021, based on the lease agreement of the relevant assets.
When a pass-through-type master lease agreement has been concluded for the assets, however, the total number of end tenants is indicated for the portion covered by the
pass-through-type master lease agreement among such assets. In cases in which one tenant has concluded lease agreements of different use types for the same single asset,
the tenant shall be counted as one for each use type.
(Note 2) Figures for “operating revenue from real estate leasing” are rounded down to the nearest million yen.
(Note 3) Not disclosed, due to unavoidable circumstances in that such contains information for which consent for disclosure has not been obtained from the tenant, relevant party, etc. or
information from which confidential information can be derived.

10

(4) Schedule of renewable energy generation facilities in the portfolio
Not applicable.

(5) Schedule of the rights to operate public facilities, etc. in the portfolio
Not applicable.

(6) Status of other assets
Real estate and trust beneficiary rights that have real estate as trust assets, etc. held by SANKEI REAL ESTATE are listed altogether on the
aforementioned (3) Real estate assets in the portfolio.

1) Schedule of Securities Incorporated in the Portfolio
Not applicable.

2) Status of Contract Amounts, etc. and Fair Value of Specified Transactions
Not applicable.

(7) Status of assets held in each country/region
Not applicable for any country or region outside Japan.

11

4. Capital Expenditures for Real Estate Held(1) Schedule of capital expenditures
No capital expenditures associated with renovation work, etc. are currently planned for assets held by SANKEI REAL ESTATE as of February 28,
2021. There may end up being a portion separately charged to capital expenditures in accounting.

(2) Capital expenditures during the fiscal period
No major construction works falling under the category of capital expenditures of 10 million yen or more were conducted in the fiscal period underreview for assets held by SANKEI REAL ESTATE as of February 28, 2021. For the fiscal period under review, capital expenditures amounted to 42
million yen and repair expenses separately charged to expenses amounted to 35 million yen for a combined total of 78 million yen of construction
works implemented.

(3) Cash reserves for long-term repair plans
Based on long-term repair plans formulated on a property-by-property basis, SANKEI REAL ESTATE makes the following provision of reserve forrepairs from cash flows during the fiscal period for the purpose of allocating to medium- to long-term future large-scale repairs and other funds.
Fiscal period
Balance of reserve at beginning of period(thousand yen)
Provision of reserve during period(thousand yen)
Reversal of reserve during period(thousand yen)
Reserve carried forward(thousand yen)

2nd fiscal period
From Sep. 1, 2019
to Feb. 29, 2020

3rd fiscal period
From Mar. 1, 2020
to Aug. 31, 2020

4th fiscal period
From Sep. 1, 2020
to Feb. 28, 2021－

95,103

130,466

217,842

95,103

105,897

128,187

59,293－70,53440,812

101,255

95,103

130,466

217,842

175,880

1st fiscal period
From Nov. 19, 2018
to Aug. 31, 201912

5. Status of Expenses and Liabilities(1) Details of expenses related to asset management(Unit: thousand yen)

Item

3rd fiscal period
From Mar. 1, 2020
to Aug. 31, 2020

4th fiscal period
From Sep. 1, 2020
to Feb. 28, 2021

183,485

186,562

Asset management fee (Note)
Asset custody fee

1,505

1,568

Administrative service fees

6,370

7,065

Remuneration for directors (and other officers)

3,600

3,600

Other expenses

35,23040,510230,191

239,306

Total(Note) Aside from the amount of the asset management fees shown above, 42,000 thousand yen was paid in the 4th fiscal period for asset management related to the acquisitionof individual investment properties, included in their book value.

(2) Status of loans
The status of loans from respective financial institutions as of February 28, 2021 is as follows.
Category

Balance at
beginning of
period(million yen)

Balance at endof period(million yen)

1,331

1,331

929

929

796

796

509

509

465

465

Shinsei Bank, Ltd.

385

385

Resona Bank, Ltd.

385

385

Mizuho Bank Ltd.

1,574

1,574

1,084

1,084

929

929

593

593

542

542

Shinsei Bank, Ltd.

439

439

Resona Bank, Ltd.

439

439

Mizuho Bank Ltd.

972

972

716

716

614

614

392

392

358

358

Shinsei Bank, Ltd.

324

324

Resona Bank, Ltd.

324

324

LenderDrawdown
date

Mizuho Bank Ltd.
Sumitomo Mitsui
Banking Corporation
Development Bank ofJapan, Inc.
Mizuho Trust & Banking
Co., Ltd.
Sumitomo Mitsui Trust
Bank Limited

Long-term
loans

Sumitomo Mitsui
Banking Corporation
Development Bank ofJapan, Inc.
Mizuho Trust & Banking
Co., Ltd.
Sumitomo Mitsui Trust
Bank Limited

Sumitomo Mitsui
Banking Corporation
Development Bank ofJapan, Inc.
Mizuho Trust & Banking
Co., Ltd.
Sumitomo Mitsui Trust
Bank Limited

Mar. 12,2019Mar. 12,2019Mar. 12,2019

13

Averageinterest rate
(Note 1)Maturity
date(Note 2)

Repayment
methodUse offunds

Remarks

0.24829%(floatinginterest rate)

Mar. 12,2021

Lump-sum
repayment
upon maturity(Note 3)

Unsecured/
Unguaranteed

0.36969%(fixedinterest rate)

Mar. 12,2022

Lump-sum
repayment
upon maturity(Note 3)

Unsecured/
Unguaranteed

0.42346%(fixedinterest rate)

Mar. 12,2023

Lump-sum
repayment
upon maturity(Note 3)

Unsecured/
UnguaranteedBalance at
beginning of
period(million yen)

Balance at
end of period(million yen)

856

856

639

639

548

548

350

350

319

319

Shinsei Bank, Ltd.

294

294

Resona Bank, Ltd.

294

294

Mizuho Bank Ltd.

2,250

2,250

1,500

1,500

620

620

550

550

Shinsei Bank, Ltd.

490

490

Resona Bank, Ltd.

490

490

Mizuho Bank Ltd.

950

950

800

800

2,000

2,000

620

620

550

550

Shinsei Bank, Ltd.

490

490

Resona Bank, Ltd.

490

490

Mizuho Bank Ltd.

1,167

1,167

832

832

713

713

456

456

416

416

358

358

358

358

－

4,300

33,50037,800Category

LenderDrawdown
date

Mizuho Bank Ltd.
Sumitomo Mitsui Banking
Corporation
Development Bank ofJapan, Inc.
Mizuho Trust & Banking
Co., Ltd.
Sumitomo Mitsui Trust
Bank Limited

Sumitomo Mitsui Banking
Corporation
Mizuho Trust & Banking
Co., Ltd.
Sumitomo Mitsui Trust
Bank Limited

Long-term
loans

Sumitomo Mitsui Banking
Corporation
Development Bank ofJapan, Inc.
Mizuho Trust & Banking
Co., Ltd.
Sumitomo Mitsui Trust
Bank Limited

Sumitomo Mitsui Banking
Corporation
Development Bank ofJapan, Inc.
Mizuho Trust & Banking
Co., Ltd.
Sumitomo Mitsui Trust
Bank Limited

Mar. 12,2019

Sep. 3,2019

Sep. 3,2019Mar. 12,2020

Shinsei Bank, Ltd.
Resona Bank, Ltd.
Mizuho Bank Ltd.

Oct. 1,
2020

Total

Average interest rate
(Note 1)Maturity
date(Note 2)0.49096%(fixed interest
rate)

Mar. 12,2024

0.27390%(floatinginterest rate)

Use offunds

Remarks

Lump-sum
repayment
upon maturity(Note 3)

Unsecured/
Unguaranteed

Sep. 3,2022

Lump-sum
repayment
upon maturity(Note 3)

Unsecured/
Unguaranteed

0.36200%(fixed interest
rate)

Sep. 3,2023

Lump-sum
repayment
upon maturity(Note 3)

Unsecured/
Unguaranteed

0.32923%(fixed interest
rate)

Sep. 12,2024

Lump-sum
repayment
upon maturity(Note 4)

Unsecured/
Unguaranteed

0.22262%(floatinginterest rate)

Oct. 1,2021

Lump-sum
repayment
upon maturity(Note 3)

Unsecured/
Unguaranteed(Note 1) The average interest rate is a weighted-average figure during the fiscal period and is rounded to the five decimal places.
(Note 2) If the maturity date is not a business day, the immediately following business day shall be the maturity date.
(Note 3) These funds are used for acquiring real estate or real estate trust beneficiary rights and accompanying expenses.
(Note 4) The funds are used to repay existing loans.

(3) Investment corporation bonds
Not applicable.

(4) Short-term investment corporation bonds
Not applicable.

(5) Investment unit acquisition rights
Not applicable.
14

Repayment
method6. Acquisitions and Sales during the 4th Fiscal Period(1) Acquisition and sale of real estate, asset-backed securities, infrastructure assets, etc. andinfrastructure-related assets, etc.
Acquisition
Property name
S-GATE AKASAKA(60% quasi co-ownership interest)

Sale

Acquisition date

Acquisition price(million yen)

October 1, 2020

4,200

－

－

－

－

－

4,200

－

－

－

－

Total

Sale price(million yen)

Sale date

Book value(million yen)

Gain or loss on sale(million yen)

(Note) “Acquisition price” is the sale and purchase price of the trust beneficiary right stated in the sale and purchase agreement, rounded down to the nearest million yen. The sale andpurchase prices do not include consumption tax, local consumption tax and the various expenses required for the acquisition. Furthermore, the indicated figure is equivalent for thequasi co-ownership interest (60%) acquired by SANKEI REAL ESTATE.

(2) Acquisition and sale of other assets
Main assets other than the above real estate and asset-backed securities, etc. are bank deposits or bank deposits within trust assets.

(3) Survey on prices of specified assets, etc.
Real estate, etc.
Acquisition or sale

Acquisition

Property name

Transaction date

Type of asset

Acquisition price orsale price(million yen)

Real estateAppraisal value(million yen)Appraisal date

Appraiser

S-GATE AKASAKA

October 1, 2020

Real estate trust
beneficiary right

4,200

4,266

August 1, 2020

Japan Real
Estate Institute(60% quasi co-ownership interest)(Note 1) The appraisal value indicated above was prepared by the appraiser based on the Real Estate Appraisal Standards, Specific Thesis Chapter 3: “Appraisal on Prices of Real Estate
Subject to Securitization.”(Note 2) “Acquisition price or sale price” is the sale and purchase price of the trust beneficiary right stated in the sale and purchase agreement, rounded down to the nearest million yen.
The sale and purchase prices do not include consumption tax, local consumption tax and the various expenses required for the acquisition. Furthermore, the indicated figure isequivalent for the quasi co-ownership interest (60%) acquired by SANKEI REAL ESTATE.

(4) Transactions with interested parties, etc.
1) Transaction status
Category
Total

Transaction amount, etc. (million yen) (Note 2)
Purchase amount, etc.

Sale amount, etc.

4,200

－

Breakdown of transactions with interested parties, etc. (Note 1)
The Sankei Building Co., Ltd.
Total

4,200

(100.0%)－( － %)

4,200(100.0%)－( － %)(Note 1) “Interested parties, etc.” refer to the interested parties, etc., as defined in Article 123 of the Order for Enforcement of the Act on Investment
Trusts and Investment Corporations and in Article 26, Paragraph 1, Item 27 of the Regulations Concerning Investment Reports of Investment
Trusts and Investment Corporations issued by The Investment Trusts Association, Japan, of the asset management company that has entered into an asset management agreement with SANKEI REAL ESTATE.
(Note 2) “Transaction amount, etc.” is the sale and purchase price of the trust beneficiary right stated in the sale and purchase agreement, rounded
down to the nearest million yen. The sale and purchase prices do not include consumption tax, local consumption tax and the various expenses required for the acquisition.
(Note 3) Figures in parenthesis represent the percentage (%) to the respective total amounts, and rounded to one decimal place.

2) Amount of fees paid, etc.
Category

Total amount offees paid, etc. (A)Property management fees

39,660 thousand yen

Building management fees

143,714 thousand yen

Breakdown of transactions with interested parties, etc.
Paid party
The Sankei Building Co., Ltd.

Paid amount (B)20,385 thousand yen

Percentage of total
amount (B/A)
51.4%

The Sankei Building Management Co., Ltd.

12,247 thousand yen

30.9%

The Sankei Building Management Co., Ltd.

122,511 thousand yen

85.3%

15

3) Major payments to other interested parties, etc.
The amounts paid to interested parties, etc. other than the fees paid, etc. above are as follows.
The Sankei Building Management Co., Ltd.

30,711 thousand yen(Repair expenses)

Sankei Shimbun Co., Ltd.

1,135 thousand yen(Land rent)

Fuji Media Holdings, Inc.

683 thousand yen(Land rent)

4) Leasing transactions, etc.
Leasing transactions conducted with interested parties, etc. are as follows.
GRANVISTA Hotels & Resorts Co., Ltd.
The Sankei Building Co., Ltd.

325,755 thousand yen(Rental revenue)

2,948 thousand yen(Rental revenue)(5) Transactions with the asset management company regarding concurrent work conducted by the asset
management company
As of February 28, 2021, Sankei Building Asset Management Co., Ltd., the asset management company of SANKEI REAL ESTATE, concurrently
conducts investment advisory and agency business and type II financial instruments business under the Financial Instruments and Exchange Act, but
has no such transactions with SANKEI REAL ESTATE. Moreover, the asset management company does not concurrently conduct any of the type I
financial instruments business, building lots and buildings transaction business, or real estate specified joint enterprise, and has no such transactions
with SANKEI REAL ESTATE.

7. Overview of Accounting(1) Assets, liabilities, principal, and profits and loss
Please refer to Balance Sheet, Statement of Income and Retained Earnings, Statement of Changes in Unitholders’ Equity, Notes to Financial
Statements and Statement of Cash Distributions on later pages of this report.

(2) Changes in calculation method of depreciation
Not applicable.

(3) Changes in valuation method of real estate and infrastructure assets, etc.
Not applicable.

(4) Status, etc. of self-managed investment trust beneficiary certificates, etc.
Not applicable.

168. Other(1) Notices
1) General Meeting of Unitholders
The overview of the items approved at SANKEI REAL ESTATE’s Second General Meeting of Unitholders held on November 18, 2020 is as follows.
Item

Overview

Partial amendments to the articles ofincorporation

・ With regard to the provisions that, when a unitholder does not attend a general meeting of unitholders and does
not exercise his/her voting right, it is deemed that the unitholder approves the proposals submitted to the general
meeting of unitholders (so-called a deemed approval system), amendments were made so that the deemed
approval system shall not be applied to the proposals concerning (1) appointment or dismissal of Executive
Directors or Supervisory Directors, (2) conclusion or cancellation of the asset management agreement with theasset management company, (3) dissolution, (4) consolidation of investment units, and (5) exemption of liabilityof the Executive Directors, Supervisory Directors, or Financial Auditor. Necessary amendments were also madein association with this.
・ Amendments were made to clearly specify that logistic facilities are included in the investment target for sub
assets of SANKEI REAL ESTATE.
・ In addition to the above, provisions that are no longer necessary in line with the closing of the first fiscal period of
SANKEI REAL ESTATE were deleted.

Election of one Executive Director

Yuichi Ota was elected as Executive Director as of November 20, 2020.

Election of one Substitute Executive
Director

Atsushi Mukai was elected as Substitute Executive Director as of November 20, 2020.

Election of two Supervisory Directors

Susumu Motoyoshi and Kohmei Shimizu were elected as Supervisory Directors as of November 20, 2020.

Election of one Substitute Supervisory
Director

Kanae Fukushima was elected as Substitute Supervisory Director as of November 20, 2020.

2) Board of Directors of the investment corporation
The main overviews of the major conclusions and changes of contracts that were approved by the Board of Directors of SANKEI REAL ESTATE
during the 4th fiscal period are as follows.
Approval date

Item

Overview
SANKEI REAL ESTATE concluded a memorandum regarding deletion of unnecessary
provisions stipulated in the asset management agreement with Sankei Building AssetManagement Co., Ltd.

December 24, 2020

Conclusion of the First Memorandum of
Amendment on the Asset Management
Agreement

January 29, 2021

・ SANKEI REAL ESTATE concluded a termination agreement to cancel the accounting
service agreement with Reiwakaikeisha Tax Corporation
Various procedures regarding changes of・ SANKEI REAL ESTATE concluded an accounting service agreement with Reiwa
consignees for administrative agency services
Accounting Holdings Co., Ltd.
(accounting and bookkeeping)・ SANKEI REAL ESTATE concluded an administrative agency agreement for taxes
with Reiwakaikeisha Tax Corporation.

(2) Disclosure on corporation owning foreign real estate
Not applicable.

(3) Disclosure on real estate owned by corporation owning foreign real estate
Not applicable.

(4) Other
Unless otherwise stated, the figures less than the specified unit are rounded down for monetary amounts and rounded off to the nearest specified unit
for percentage figures in this Report.

171. Financial Statements(1) Balance Sheet(Unit: thousand yen)

3rd fiscal period(as of Aug. 31, 2020)

4th fiscal period(as of Feb. 28, 2021)

AssetsCurrent assets
Cash and deposits

3,876,992

4,147,117

Cash and deposits in trust

3,283,341

2,797,010

Operating accounts receivable

87,95754,096

Prepaid expenses

51,89846,597

Consumption taxes receivable
Other
Total current assets

-

9,321

567,790

41,015

7,867,979

7,095,157

165,538

166,032

Non-current assets
Property, plant and equipment
Buildings
Accumulated depreciation
Buildings, net
Structures(8,698)(11,908)

156,839

154,123

353

353

Accumulated depreciation

(12)

(16)

Structures, net

340

336

Land

2,457,766

2,457,766

Buildings in trust

13,624,054

14,296,308

Accumulated depreciation
Buildings in trust, net
Structures in trust(547,766)(769,403)

13,076,288

13,526,905

22,236

23,602(813)(1,122)

Structures in trust, net

21,422

22,479Machinery and equipment in trust

2,608

2,875

Accumulated depreciation

(208)

(348)

Machinery and equipment in trust, net

2,400

2,526

Tools, furniture and fixtures in trust

25,41927,889

Accumulated depreciation(1,901)(3,719)Tools, furniture and fixtures in trust, net

23,51824,17052,510,871

56,132,321

Accumulated depreciation

Land in trust
Construction in progress in trust
Total property, plant and equipment

330

8,103

68,249,777

72,328,733

Intangible assets
Software

6,713

5,773

Total intangible assets

6,713

5,773

60,793

43,237

Investments and other assets
Long-term prepaid expenses
Deferred tax assets
Lease and guarantee deposits
Total investments and other assets
Total non-current assets
Total assets

20

14

13

10,00010,00070,80753,251

68,327,298

72,387,757

76,195,278

79,482,915

(Unit: thousand yen)

3rd fiscal period(as of Aug. 31, 2020)

4th fiscal period(as of Feb. 28, 2021)

Liabilities
Current liabilities
Operating accounts payable

205,128

170,1124,800,000

9,100,000

Accounts payable - other214,600

219,582

Accrued expenses

26,272

26,175893

879

Long-term loans due within one year

Income taxes payable
Consumption taxes payable

129,470-

Advances received

328,557

373,814

Deposits received

1,205,174

7,496

Total current liabilities

6,910,097

9,898,060

28,700,000

28,700,000

Non-current liabilities
Long-term loans
Lease and guarantee deposits received

92,93579,585

Lease and guarantee deposits received in trust

3,047,718

3,247,634

Total non-current liabilities

31,840,654

32,027,219

38,750,751

41,925,280

36,540,901

36,540,901

Unappropriated retained earnings (undisposed loss)

903,625

1,016,734

Total surplus

903,625

1,016,734

Total unitholders’ equity

37,444,526

37,557,635*1 37,444,526*1 37,557,635

76,195,278

79,482,915

Total liabilities
Net assets
Unitholders’ equity
Unitholders’ capital
Surplus

Total net assets
Total liabilities and net assets

21

(2) Statement of Income and Retained Earnings(Unit: thousand yen)

3rd fiscal period
From: Mar. 1, 2020
To: Aug. 31, 2020

4th fiscal period
From: Sep. 1, 2020
To: Feb. 28, 2021

Operating revenue*1 1,878,684*1 2,015,771

Other rent business revenue*1 126,823*1 132,163

Total operating revenue

2,005,507

2,147,934*1 778,934*1 790,014

183,485

186,562

Asset custody fee

1,505

1,568

Administrative service fees

6,370

7,065

Remuneration for directors (and other officers)

3,600

3,600

Other operating expenses

35,23040,510Total operating expenses

1,009,126

1,029,320

996,380

1,118,614

Interest income

32

21Interest on refund

323

-

-

0

356

21

Rent business revenue

Operating expenses
Expenses related to rent business
Asset management fee

Operating income
Non-operating income

Other
Total non-operating income
Non-operating expenses
Interest expenses

58,586

61,565

Borrowing related expenses

33,79037,660

Other
Total non-operating expenses

-

2,000

92,377

101,225

Ordinary income

904,359

1,017,409

Net income before income taxes

904,359

1,017,409

Income taxes - current

898

882

Income taxes - deferred

2

0

901

883

903,458

1,016,526

Total income taxes
Net income
Retained earnings brought forward
Unappropriated retained earnings (undisposed loss)

22

167

207

903,625

1,016,734

(3) Statement of Changes in Unitholders’ Equity
3rd fiscal period (from March 1, 2020, to August 31, 2020)(Unit: thousand yen)

Unitholders’ equity
Surplus
Unitholders’capitalBalance at beginning of period

Unappropriatedretained earnings(undisposed loss)

36,540,901

Total surplus

Total unitholders’equityTotal net assets

1,068,783

1,068,783

37,609,684

37,609,684(1,068,616)(1,068,616)(1,068,616)(1,068,616)

903,458

903,458

903,458

903,458-(165,157)(165,157)(165,157)(165,157)

36,540,901

903,625

903,625

37,444,526

37,444,526

Changes in items during period
Dividend from surplus
Net income
Total changes in items during period
Balance at end of period*1

4th fiscal period (from September 1, 2020, to February 28, 2021)(Unit: thousand yen)

Unitholders’ equity
Surplus
Unitholders’ capital

Balance at beginning of period

36,540,901

Unappropriatedretained earnings(undisposed loss)

Total surplus

Total unitholders’equityTotal net assets

903,625

903,625

37,444,526

37,444,526

Dividend from surplus(903,417)(903,417)(903,417)(903,417)

Net income

1,016,526

1,016,526

1,016,526

1,016,526-

113,108

113,108

113,108

113,108*1 36,540,901

1,016,734

1,016,734

37,557,635

37,557,635

Changes in items during period

Total changes in items during period
Balance at end of period23

(4) Statement of Cash Distributions(Unit: yen)

4th fiscal period
From: Sep. 1, 2020
To: Feb. 28, 2021

3rd fiscal period
From: Mar. 1, 2020
To: Aug. 31, 2020
I. Unappropriated retained earnings

903,625,576

1,016,734,169

II. Amount of distribution

903,417,600

1,016,523,200[Amount of distribution per unit][2,532][2,849]III. Retained earnings carried forward

207,976

210,969

Method of calculation of amount of distribution

In accordance with the policy on distribution
specified in Article 36, Paragraph 1 of SANKEIREAL ESTATE’s articles of incorporation, theamount of distribution shall be limited to theamount of net income in excess of the amountequivalent to 90% of distributable profit, as
stipulated in Article 67-15 of the Act on Special
Measures Concerning Taxation. Based on
this policy, the decision was made to distribute
903,417,600 yen, which is the largest integral
multiple of the total number of investment units
issued and outstanding (356,800 units) not inexcess of unappropriated retained earnings.
The distribution in excess of earnings specified
in Article 36, Paragraph 2 of SANKEI REALESTATE’s articles of incorporation will not be
made.

24

In accordance with the policy on distribution
specified in Article 36, Paragraph 1 of SANKEIREAL ESTATE’s articles of incorporation, theamount of distribution shall be limited to theamount of net income in excess of the amountequivalent to 90% of distributable profit, as
stipulated in Article 67-15 of the Act on Special
Measures Concerning Taxation. Based on
this policy, the decision was made to distribute
1,016,523,200 yen, which is the largest integral
multiple of the total number of investment units
issued and outstanding (356,800 units) not inexcess of unappropriated retained earnings.
The distribution in excess of earnings specified
in Article 36, Paragraph 2 of SANKEI REALESTATE’s articles of incorporation will not bemade.

(5) Statement of Cash Flows(Unit: thousand yen)

3rd fiscal period
From: Mar. 1, 2020
To: Aug. 31, 2020

4th fiscal period
From: Sep. 1, 2020
To: Feb. 28, 2021

Cash flows from operating activities
Net income before income taxes

904,359

1,017,409

Depreciation

220,471

228,057

Interest income
Interest expenses

(32)

(21)

58,586

61,565Decrease (increase) in operating accounts receivable(23,792)

34,103

Decrease (increase) in consumption taxes refund receivable

369,256(9,321)

Decrease (increase) in prepaid expenses(10,700)

5,300

Increase (decrease) in operating accounts payable

58,297(54,667)

Increase (decrease) in accounts payable - other

52,356

4,076

Increase (decrease) in consumption taxes payable

129,470(129,470)

Increase (decrease) in advances received(12,866)

45,256

Increase (decrease) in deposits received

254,170(1,197,677)

Decrease (increase) in long-term prepaid expenses(915)

17,555Decrease (increase) in other assets(225,717)

526,775

Subtotal

1,772,944

548,943

Interest received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities

32

21(57,188)(61,662)

(951)

(896)

1,714,837

486,405

Cash flows from investing activities
Purchase of property, plant and equipment(5,747)(493)

Purchase of property, plant and equipment in trust(46,376)(4,286,634)

Proceeds from lease and guarantee deposits received

1,400

81

Refund of lease and guarantee deposits received(502)(12,724)

142,697

232,800

Proceeds from lease and guarantee deposits received in trust
Refund of lease and guarantee deposits received in trust
Net cash provided by (used in) investing activities(8)(33,127)

91,461(4,100,099)

Cash flows from financing activities
Repayments of short-term loans(4,756,000)-

Proceeds from long-term loans

4,300,000

4,300,000

Dividends paid

(1,067,674)(902,512)

Net cash provided by (used in) financing activities(1,523,674)

3,397,487

Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period*125

282,624(216,205)

6,877,708

7,160,333

7,160,333*1

6,944,127

(6) Notes to Financial Statements(Notes on the Going Concern Assumption)
Not applicable.
(Notes on Matters Concerning Significant Accounting Policies)
1. Method of depreciation of non-current assets(1) Property, plant and equipment (including trust assets)
The straight-line method is adopted. Furthermore, the useful lives of major property, plant and equipment are as follows:
Buildings
2–65 years
Structures
6–59 years
Machinery and equipment 8-10 years
Tools, furniture and fixtures 4–8 years(2) Intangible assets
The straight-line method is adopted.
(3) Long-term prepaid expenses
The straight-line method is adopted.

2. Standards for revenue and expense
recognition

Accounting for fixed asset tax, etc.
For fixed asset tax, city planning tax and, depreciable asset tax, etc. on real estate or trust beneficiaryrights of real estate the tax levied corresponding to the calculation period is recorded as expenses
related to rent business.
Furthermore, the amount equivalent to fixed asset tax, etc. in the initial fiscal year paid by SANKEIREAL ESTATE upon acquisition of real estate or trust beneficiary rights of is included in the cost of
acquisition of the real estate, etc., not recognized as expenses. The amount equivalent to fixed asset
tax, etc. included in the cost of acquisition of real estate, etc. was nil in the previous fiscal period. The
amount equivalent to fixed asset tax, etc. included in the cost of acquisition of real estate, etc. was 3,425
thousand yen in the current fiscal period.

3. Scope of cash (cash and cash equivalents)
in the statement of cash flows

Cash and cash equivalents in the statement of cash flows comprise cash on hand and cash in trust,demand deposits and deposits in trust, and short-term investments with a maturity of three months orless from the date of acquisition that are readily convertible to cash and that are subject to an insignificant
risk of changes in value.

4. Other significant matters related to the
preparation of the financial statements(1) Accounting for trust beneficiary rights that have real estate, etc. as trust assets
Concerning trust beneficiary rights that have real estate, etc. as trust assets held, all accounts ofassets and liabilities within trust assets and all accounts of revenue and expenses from the trust
assets are recognized in the relevant account item of the balance sheet and the statement of income
and retained earnings.
Furthermore, the following material items of the trust assets recognized in the relevant accountitem are separately listed on the balance sheet.
i. Cash and deposits in trustii. Buildings in trust; Structures in trust; Machinery and equipment in trust; Tools, furniture andfixtures in trust; Land in trust; Construction in progress in trustiii. Lease and guarantee deposits received in trust(2) Accounting for consumption tax, etc.
The accounting for consumption tax and local consumption tax is by the method of exclusion of thetaxes.

(Notes on Accounting Standards, Etc. Yet to be Applied)• “Accounting Standard for Revenue Recognition” (Accounting Standards Board of Japan (ASBJ) Statement No. 29 issued on March 31, 2020)• “Implementation Guidance on Accounting Standard for Revenue Recognition” (ASBJ Guidance No. 30 issued on March 31, 2020)• “Implementation Guidance on Disclosures about Fair Value of Financial Instruments” (ASBJ Guidance No. 19 issued on March 31, 2020)

1. Overview
The International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) in the United States have jointly developed
comprehensive accounting standards for revenue recognition and issued “Revenue from Contracts with Customers” (IFRS 15 by IASB and Topic 606 by
FASB) in May 2014. Given the situation where IFRS 15 will be applied from fiscal years beginning on or after January 1, 2018 and that Topic 606 will beapplied from fiscal years beginning after December 15, 2017, the ASBJ has developed a comprehensive accounting standard for revenue recognition
and issued such together with an implementation guidance.
The basic policy for the ASBJ when it developed the accounting standard for revenue recognition was to determine the accounting standard,
incorporating the basic principles of IFRS 15 as a starting point, from the perspective of comparability between financial statements, which is one of thebenefits of consistency with IFRS 15. If there is an item to which consideration should be given, such as practices that have been conducted thus far inJapan, alternative treatments shall be added to the extent to which comparability is not impaired.

26

2. Scheduled application dateThose standard and guidance will be applied at the beginning of the fiscal period ending February 28, 2022.

3. Impact of applying the accounting standards, etc.
The impact on the financial statements of the applying of this standard and guidance is currently under review.
• “Accounting Standard for Fair Value Measurement” (ASBJ Statement No. 30 issued on July 4, 2019)• “Accounting Standard for Financial Instruments” (ASBJ Statement No. 10 issued on July 4, 2019)• “Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ Guidance No. 31 issued on July 4, 2019)• “Implementation Guidance on Disclosures about Fair Value of Financial Instruments” (ASBJ Guidance No. 19 issued on March 31, 2020)

1. Overview
The IASB and the FASB in the United States set up detailed guidance on fair value measurement (IFRS 13 “Fair Value Measurement”
by IASB and Topic 820 “Fair Value Measurement” by FASB). To improve the comparability with the provisions of these international accounting
standards, the ASBJ discussed the guidance and disclosure regarding mainly the fair value of financial instruments, and announced an
accounting standard for fair value measurement and an implementation guidance on the accounting standard for fair value measurement.
The basic policy for the ASBJ when it developed the accounting standard for fair value measurement was to incorporate basically allof the provisions of IFRS 13, from the perspective of improving the comparability between financial statements among domestic andinternational companies by using a unified method of measurement. To the extent that the comparability between financial statements is not
significantly impaired, other treatments of individual items shall be determined considering practices that have been conducted thus far in Japan, etc.

2. Scheduled application dateThose standards and guidance will be applied at the beginning of the fiscal period ending February 28, 2022.

3. Impact of applying the accounting standards, etc.
The impact on the financial statements of the applying of this standard and guidance is currently under review.
• ”Accounting Standard for Disclosure of Accounting Estimates” (ASBJ Statement No. 31 issued on March 31, 2020)

1. Overview
In the International Accounting Standards (IAS), Paragraph 125 of IAS 1 “Presentation of Financial Statements” announced by IASB in 2003
requires disclosure of the “sources of estimation uncertainty.” There were requests to consider requirement of such disclosure as notesin the Japanese standards, as the information would be highly useful for users of financial statements, and the ASBJ thus developed andannounced an accounting standard for disclosure of accounting estimates (hereinafter, “this Accounting Standard”).
The basic policy for the ASBJ when it developed this Accounting Standard was to not extend individual notes but show the principles(purposes of disclosure) and have companies judge the specific disclosure contents based on the purposes of disclosure, using the provisions ofParagraph 125 of IAS 1 as a reference in the development.

2. Scheduled application dateThis Accounting Standards will be applied at the end of the fiscal period ending August 31, 2021.
• “Accounting Standard for Accounting Policy Disclosures, Accounting Changes and Error Corrections” (ASBJ Statement No. 24 issued on
March 31, 2020)

1. Overview
Due to the proposal for the consideration on the enrichment of the information on notes regarding the “principles and procedures of accounting
adopted when the provision of related accounting standards are not clear,” such standard was issued as an accounting standard for accounting
policy disclosures, accounting changes and error corrections after making necessary amendments by the ASBJ.
Moreover, upon the enrichment of the information on notes regarding the “principles and procedures of accounting adopted when the provision of related accounting standards are not clear,” the provision of the annotations on the corporate accounting principles (Notes 1-2) shall beeffective to avoid any impact on actual business practices until now when the provision of the related accounting standards are clear.

2. Scheduled application dateThis standard will be applied at the end of the fiscal period ending August 31, 2021.
27

(Notes to the Balance Sheet)*1. Minimum net assets as provided in Article 67, Paragraph 4 of the Act on Investment Trusts and Investment Corporations(Unit: thousand yen)

3rd fiscal period(as of Aug. 31, 2020)

4th fiscal period(as of Feb. 28, 2021)

50,00050,000(Notes to the Statement of Income and Retained Earnings)*1. Breakdown of operating income (loss) from real estate leasing(Unit: thousand yen)

4th fiscal period
From: Sep. 1, 2020
To: Feb. 28, 2021

3rd fiscal period
From: Mar. 1, 2020
To: Aug. 31, 2020
A. Operating revenue from real estate leasing
Rent business revenue
Rental revenue

1,727,126

Common area maintenance revenue
Total rent business revenue

1,868,319

151,557

147,452

1,878,684

2,015,771

Other rent business revenue
Utilities revenue

90,92593,366

Parking revenue

29,46030,655

Other rental revenue

6,437

8,141

126,823

132,1632,005,507

2,147,934

Total other rent business revenue
Total operating revenue from real estate leasing
B. Operating expenses from real estate leasing
Expenses related to rent businessOutsourcing expenses

172,779

183,374

Utilities expenses

118,648

110,924

Property taxes

215,328

214,815

Land rent

1,818

1,818

Repair expenses

35,14835,844

Insurance premium

4,449

4,664

Trust fee

3,200

2,371

219,531

227,117

Depreciation

8,029

9,081

Total expenses related to rent business

778,934

790,014

Total operating expenses from real estate leasing

778,934

790,0141,226,572

1,357,920

Other expenses related to rent business

C. Operating income (loss) from real estateleasing [A−B]28

(Notes to the Statement of Changes in Unitholders’ Equity)*1. Total number of investment units authorized and total number of investment units issued and outstanding(Unit: units)

3rd fiscal period
From: Mar. 1, 2020
To: Aug. 31, 2020

4th fiscal period
From: Sep. 1, 2020
To: Feb. 28, 2021

Total number of investment units authorized

10,000,000

10,000,000

Total number of investment units issued andoutstanding

356,800

356,800(Notes to the Statement of Cash Flows)*1. Reconciliation of cash and cash equivalents at end of period to the amount of balance sheet items(Unit: thousand yen)

3rd fiscal period
From: Mar. 1, 2020
To: Aug. 31, 2020

4th fiscal period
From: Sep. 1, 2020
To: Feb. 28, 2021

Cash and deposits
Cash and deposits in trust

3,876,992
3,283,341

4,147,117
2,797,010

Cash and cash equivalents

7,160,333

6,944,127(Notes on Lease Transactions)Operating lease transactions (as lessor)
Future minimum lease payments(Unit: thousand yen)

3rd fiscal period(as of Aug. 31, 2020)

4th fiscal period(as of Feb. 28, 2021)

Due within 1 year
Due after 1 year

2,457,949
15,854,148

2,692,306
15,407,566

Total

18,312,097

18,099,872(Notes on Financial Instruments)

1. Matters concerning status of financial instruments(1) Policy for handling financial instruments
SANKEI REAL ESTATE shall procure funds in a well-balanced manner through borrowing from financial institutions, issuance ofinvestment corporation bonds, issuance of new investment units, etc. to contribute to steady growth of assets under management as well as efficient
operation and stability of management.
Upon borrowing from financial institutions, issuance of investment corporation bonds, etc., the fund procurement shall be in a mannerthat gives due consideration to the balance between agility in fund procurement and financial stability, characteristics of to-be-acquired
real estate, etc. Specifically, the procurement means, ratio of long-term debt, ratio of fixed-rate debt, staggering of maturities, provisionof collateral or not, etc. shall be considered. If borrowing, lenders shall be limited to the qualified institutional investors provided in the
Financial Instruments and Exchange Act (however, limited to the institutional investors provided in Article 67-15 of the Act on Special Measures
Concerning Taxation).
Issuanc e of new investment units shall be for the purpose of expansion of asset size and enhanc ement of prof itabilit y, andimplementation decided by taking into account the LT V ratio, dilution of existing unitholders’ rights and accompanying decline intransaction price of investment units, etc. and in light of the financial environment.
Derivative transactions may be conducted for the purpose of hedging the risk of fluctuation in interest rates and other risks on
SANKEI REAL ESTATE arising from the concerned liabilities. No derivative transactions were conducted in the current fiscal period.

(2) Description of financial instruments and associated risks, and risk management system
Loans are mainly for the purpose of procuring funds for acquisition of assets and funds for repayment of obligations. Loans are
exposed to the risk of inability to refinance upon becoming due for repayment, risk of rise in the interest rate payable, etc., but the risks are
mitigated by considering fund procurement that is well balanced through issuance of investment units, etc. while also diversifying fund procurement
sources and staggering maturities. In addition, the risk of rise in interest rates on SANKEI REAL ESTATE’s operations is managed by closely
watching interest rate trends and keeping the LTV ratio under control in an appropriate manner.

29

(3) Supplementary explanation to matters concerning fair value, etc. of financial instruments
The fair value of financial instruments is values based on market price, but may other wise include values based on reasonablecalculation when no market price is available. Cer tain assumptions, etc. are adopted in the calculation of the concerned values.
Accordingly, the concerned values may vary when different assumptions, etc. are adopted.

2. Matters concerning fair value, etc. of financial instruments
The following are the carrying amount and fair value as of August 31, 2020, and the amount of difference between these. Financial
instruments for which estimation of fair value is recognized to be extremely difficult are not included in the following table (Note 2).
(Unit: thousand yen)

Carrying amount(1) Cash and deposits(2) Cash and deposits in trust
Total assets(1) Long-term loans due within one year
(2) Long-term loans
Total liabilities

Fair value

Amount of difference

3,876,992
3,283,341

3,876,992
3,283,341-

7,160,333

7,160,333-

4,800,000
28,700,000

4,800,000
28,737,004

37,00433,500,000

33,537,004

37,004

The following are the carrying amount and fair value as of February 28, 2021, and the amount of difference between these. Financial instruments forwhich estimation of fair value is recognized to be extremely difficult are not included in the following table (Note 2).
(Unit: thousand yen)

Carrying amount(1) Cash and deposits(2) Cash and deposits in trust
Total assets(1) Long-term loans due within one year
(2) Long-term loans
Total liabilities

Fair value

Amount of difference

4,147,117
2,797,010

4,147,117
2,797,010-

6,944,127

6,944,127-

9,100,000
28,700,000

9,100,000
28,744,574

44,57437,800,000

37,844,574

44,574(Note 1) Method of calculation of the fair value of financial instruments

Assets(1) Cash and deposits; (2) Cash and deposits in trust
Because these are settled in a short period of time, the fair value is approximately the same as the book value and thus stated at that book value.
Liabilities(1) Long-term loans due within one year; (2) Long-term loans
Of long-term loans, because those with floating interest rates reflect market interest rates in a short period of time, the fair value is thought toresemble the book value and thus stated at that book value. However, in the case of long-term loans with fixed interest rates, the fair value iscalculated based on the present value of their future cash flows discounted over the time to maturity and at the rate adjusted for credit risks.
(Note 2) Financial instruments for which estimation of fair value is recognized to be extremely difficult(Unit: thousand yen)

3rd fiscal period(as of Aug. 31, 2020)
Lease and guarantee deposits received
Lease and guarantee deposits received in trust

4th fiscal period(as of Feb. 28, 2021)

92,93579,585

3,047,718

3,247,634* “Lease and guarantee deposits received” and “Lease and guarantee deposits received in trust” are not subject to disclosure of fair value, because there being no market price and, even if the lease contract period has been set, there being the possibility of contract cancellation before
expiration, contract extension or contract renewal make calculating the actual deposit period impossible and reasonable projection of future cash
flows is thus recognized to be extremely difficult.

30

(Note 3) Amount of redemption of monetary claims scheduled to be due after the end of the fiscal period (August 31, 2020)(Unit: thousand yen)

Due within 1
year

Due after 1 to 2
years

Due after 2 to 3
years

Due after 3 to 4
years

Cash and deposits

3,876,992

-

-

-

-

-

Cash and deposits in trust

3,283,341

-

-

-

-

-

7,160,333

-

-

-

-

-

Total

Due after 4 to 5
Due after 5 years
years

Amount of redemption of monetary claims scheduled to be due after the end of the fiscal period (February 28, 2021)(Unit: thousand yen)

Due within 1
year

Due after 1 to 2
years

Due after 2 to 3
years

Due after 3 to 4
years

Cash and deposits

4,147,117

-

-

-

-

-

Cash and deposits in trust

2,797,010

-

-

-

-

-

6,944,127

-

-

-

-

-

Total

Due after 4 to 5
Due after 5 years
years(Note 4) Amount of repayment of loans scheduled to be due after the end of the fiscal period (August 31, 2020)(Unit: thousand yen)

Long-term loans due within one year

Due within 1
year

Due after 1 to 2
years

Due after 2 to 3
years

Due after 3 to 4
years

4,800,000---

Long-term loans
Total

Due after 4 to 5
Due after 5 years
years
-

-

-

5,600,000

9,600,000

9,200,000

4,300,000-

4,800,000

5,600,000

9,600,000

9,200,000

4,300,000-

Amount of repayment of loans scheduled to be due after the end of the fiscal period (February 28, 2021)(Unit: thousand yen)

Long-term loans due within one
year

Due within 1
year

Due after 1 to 2
years

Due after 2 to 3
years

Due after 3 to 4
years

9,100,000

-

-

-

-

-

-

11,500,000

9,600,000

7,600,000--

9,100,000

11,500,000

9,600,000

7,600,000--

Long-term loans
Total(Notes on Securities)
3rd fiscal period (as of August 31, 2020)
Not applicable.
4th fiscal period (as of February 28, 2021)
Not applicable.

(Notes on Derivative Transactions)
3rd fiscal period (as of August 31, 2020)
Not applicable.
4th fiscal period (as of February 28, 2021)
Not applicable.

(Notes on Retirement Benefits)
3rd fiscal period (as of August 31, 2020)
Not applicable.
4th fiscal period (as of February 28, 2021)
Not applicable.

31

Due after 4 to 5
Due after 5 years
years

(Notes on Tax-Effect Accounting)
1. Breakdown of main deferred tax assets and deferred tax liabilities(Unit: thousand yen)
3rd fiscal period(as of Aug. 31, 2020)

4th fiscal period(as of Feb. 28, 2021)

Non-deductible accrued enterprise tax

14

13

Total

14

13

14

13

Deferred tax assets

Deferred tax assets, net

2. Reconciliation of significant differences between the statutory tax rate and the effective income tax rate
(Unit: %)3rd fiscal period(as of Aug. 31, 2020)

4th fiscal period(as of Feb. 28, 2021)

31.46

31.46

(31.43)(31.43)

Other

0.07

0.06

Effective income tax rate after application oftax-effect accounting

0.10

0.09

Statutory tax rate
[Adjustments]
Deductible distribution payable(Notes on Share of Profit (Loss) of Entities Accounted for Using Equity Method)
3rd fiscal period (from March 1, 2020, to August 31, 2020)
Not applicable.
4th fiscal period (from September 1, 2020, to February 28, 2021)
Not applicable.

(Notes on Related-Party Transactions)

1. Parent company, major corporate unitholder, etc.
3rd fiscal period (from March 1, 2020, to August 31, 2020)
Not applicable.
4th fiscal period (from September 1, 2020, to February 28, 2021)
Not applicable.

2. Affiliated company, etc.
3rd fiscal period (from March 1, 2020, to August 31, 2020)
Not applicable.
4th fiscal period (from September 1, 2020, to February 28, 2021)
Not applicable.

3. Fellow subsidiary, etc.
3rd fiscal period (from March 1, 2020, to August 31, 2020)
Not applicable.
4th fiscal period (from September 1, 2020, to February 28, 2021)
Not applicable.

4. Director, major individual unitholder, etc.
3rd fiscal period (from March 1, 2020, to August 31, 2020)32

Attribute

Director

Name ofcompany,
etc. orname ofpersonYuichi
Ota

Location-

Sharecapital orinvestments
in capital(thousandyen)

Description ofbusiness or
occupation-

Executive
Director of
SANKEI REALESTATE, andPresident andRepresentative Directorof Sankei
Building AssetManagement
Co., Ltd.

Percentage
of votingrights, etc.
held by (in)SANKEIREAL
ESTATE(%)

Description of relationship
Concurrent
holding of
positions,etc. bydirectors

Businessrelationship

Executive Director of
SANKEI REAL ESTATE,
and President andRepresentative Directorof Sankei
Building AssetManagement Co., Ltd.

-

Descriptionoftransaction

Transaction
amount(thousandyen)

Account
item

Balanceat endof period(thousandyen)

Paymentof assetmanagement
fee to asset
managementcompany(Note 3)

183,485

Accounts
payable- other

201,834(Note 1) Of the related-party transactions subject to disclosure, the related-party transactions including significant transactions are disclosed.
(Note 2) Of the amounts above, transaction amount does not include consumption tax, etc., while balance at end of period includes consumption tax, etc. Amounts are rounded down to
the nearest thousand yen.
(Note 3) Payment of asset management fee is for transactions conducted by Yuichi Ota as representative of Sankei Building Asset Management Co., Ltd., and transaction amount isbased on the terms and conditions provided in SANKEI REAL ESTATE’s articles of incorporation.
(Note 4) Transaction terms and conditions are decided based on the actual market conditions.

4th fiscal period (from September 1, 2020, to February 28, 2021)

Attribute

Director

Name ofcompany,
etc. orname ofpersonYuichi
Ota

Location-

Sharecapital orinvestments
in capital(thousandyen)

Description ofbusiness or
occupation-

Executive
Director of
SANKEI REALESTATE, andPresident andRepresentative Directorof Sankei
Building AssetManagement
Co., Ltd.

Description of relationship

Percentage
of votingrights,etc. heldby (in)SANKEIREAL
ESTATE(%)

Concurrent
holding of
positions,etc. bydirectors

Businessrelationship

Executive Director of
SANKEI REAL ESTATE,
and President andRepresentative Directorof Sankei
Building AssetManagement Co., Ltd.

-

Descriptionoftransaction

Transaction
amount(thousandyen)

Account
item

Balanceat endof period(thousandyen)

Paymentof assetmanagement
fee to asset
managementcompany(Note 3)

228,562(Note 4)

Accounts
payable- other

205,218(Note 1) Of the related-party transactions subject to disclosure, the related-party transactions including significant transactions are disclosed.
(Note 2) Of the amounts above, transaction amount does not include consumption tax, etc., while balance at end of period includes consumption tax, etc. Amounts are rounded down to
the nearest thousand yen.
(Note 3) Payment of asset management fee is for transactions conducted by Yuichi Ota as representative of Sankei Building Asset Management Co., Ltd., and transaction amount isbased on the terms and conditions provided in SANKEI REAL ESTATE’s articles of incorporation.
(Note 4) Asset management fee includes the portion of the fee for property acquisition included in the book value of individual real estate, etc. (42,000 thousand yen)
(Note 5) Transaction terms and conditions are decided based on the actual market conditions.

33

(Notes on Asset Retirement Obligations)
3rd fiscal period (from March 1, 2020, to August 31, 2020)
Not applicable.
4th fiscal period (from September 1, 2020, to February 28, 2021)
Not applicable.

(Notes on Investment and Rental Properties)
SANKEI REAL ESTATE owns office buildings, etc. for the purpose of earning revenue from leasing. The carrying amount, amount of change during
period and fair value of these investment and rental properties are as follows:(Unit: thousand yen)

3rd fiscal period
From: Mar. 1, 2020
To: Aug. 31, 2020

4th fiscal period
From: Sep. 1, 2020
To: Feb. 28, 2021

Carrying amount
Balance at beginning of period
Amount of change during period
Balance at end of period
Fair value at end of period

68,414,911

68,249,447(165,463)

4,071,182

68,249,447

72,320,630

75,770,000

79,181,000(Note 1) Carrying amount is the amount of the cost of acquisition, less accumulated depreciation.
(Note 2) Of the amount of change during period, the amount of increase in the previous fiscal period is mainly attributable to capital expenditures (54,067 thousand yen), etc.,
while the amount of decrease is mainly attributable to depreciation (219,531 thousand yen). The amount of increase in the current fiscal period is mainly attributable tonew property acquisition of 1 property (4,255,758 thousand yen), etc., while the amount of decrease is mainly attributable to depreciation (227,117 thousand yen).
(Note 3) Fair value at end of period is the appraisal value by an external real estate appraiser.

Furthermore, the income (loss) concerning investment and rental properties is presented in “Notes to the Statement of Income and Retained
Earnings.”(Notes on Segment Information, Etc.)

1. Segment information
The information is omitted since SANKEI REAL ESTATE has a single segment—the real estate rent business.

2. Related information
3rd fiscal period (from March 1, 2020, to August 31, 2020)(1) Information by product and service
The information is omitted since operating revenue to external customers for a single group of products and services exceeds 90% of
operating revenue on the statement of income and retained earnings.

(2) Information by geographic area
i. Operating revenue
The information is omitted since operating revenue to external customers in Japan exceeds 90% of operating revenue on the statement ofincome and retained earnings.
ii. Property, plant and equipment
The information is omitted since the amount of property, plant and equipment located in Japan exceeds 90% of the amount of property, plantand equipment on the balance sheet.

(3) Information by major customer(Unit: thousand yen)

Name of customer

Operating revenue

GRANVISTA Hotels & Resorts Co., Ltd.
Sony Corporation

Related segment
325,755

Not disclosed (Note)(Note) Not disclosed, due to unavoidable circumstances in that consent for disclosure has not been obtained from the lessee.

34

Real estate rent business
Real estate rent business4th fiscal period (from September 1, 2020, to February 28, 2021)(1) Information by product and service
The information is omitted since operating revenue to external customers for a single group of products and services exceeds 90% of
operating revenue on the statement of income and retained earnings.

(2) Information by geographic area
i. Operating revenue
The information is omitted since operating revenue to external customers in Japan exceeds 90% of operating revenue on the statement ofincome and retained earnings.
ii. Property, plant and equipment
The information is omitted since the amount of property, plant and equipment located in Japan exceeds 90% of the amount of property,
plant and equipment on the balance sheet.

(3) Information by major customer(Unit: thousand yen)

Name of customer

Operating revenue

Sony Corporation

Related segment
325,755

GRANVISTA Hotels & Resorts Co., Ltd.

Not disclosed (Note)

Real estate rent business
Real estate rent business(Note) Not disclosed, due to unavoidable circumstances in that consent for disclosure has not been obtained from the lessee.

(Notes on Per Unit Information)
3rd fiscal period
From: Mar. 1, 2020
To: Aug. 31, 2020

4th fiscal period
From: Sep. 1, 2020
To: Feb. 28, 2021

Net assets per unit

104,945 yen

105,262 yen

Net income per unit

2,532 yen

2,849 yen

(Note 1) Net income per unit is calculated by dividing net income by the period’s daily weighted average number of investment units (fiscal period ended August 2020:
356,800 units; fiscal period ended February 2021: 356,800 units). In addition, diluted net income per unit is not stated, because there are no diluted investment units(Note 2) The basis for calculation of net income per unit is as follows:

3rd fiscal period
From: Mar. 1, 2020
To: Aug. 31, 2020
Net income (thousand yen)

4th fiscal period
From: Sep. 1, 2020
To: Feb. 28, 2021

903,458

1,016,526--

Net income attributable to common investment units(thousand yen)903,458

1,016,526

Average number of investment units during period (units)356,800

356,800

Amount not available to common unitholders (thousand yen)

(Notes on Significant Subsequent Events)
Not applicable.

35

(7) Supplementary Schedules
1) Schedule of Securities
a. Shares
Not applicable.
b. Securities other than shares
Not applicable.

2) Status of Contract Amounts, etc. and Fair Value of Derivative Transactions and Forward Exchange Transactions
Not applicable.

3) Schedule of Assets Related to Real Estate

Type of asset

Balance atIncrease during Decrease during
beginning of
periodperiodperiod(thousand yen) (thousand yen)(thousand yen)

Balance at end of
period(thousand yen)
Or accumulated
amortization(thousand yen)

Accumulated depreciation
Or
Depreciation Net balance ataccumulated during period end of period Remarks
amortization (thousand (thousand yen)(thousand
yen)
yen)

Buildings

165,538493-

166,032

11,9083,209

154,123

Structures

353

-

-

353

16

4

336

(Note)

Land

2,457,766--

2,457,766--

2,457,766

Buildings in trust

13,624,054

672,253-

14,296,308

769,403

221,636

13,526,905(Note)

22,236

1,365-

23,602

1,122

309

22,479(Note)

Property, Machinery andplant and equipment inequipment trust

2,608

267

-

2,875

348

140

2,526

(Note)

Tools, furnitureand fixtures intrust

25,4192,472

227,889

3,719

1,818

24,170(Note)

52,510,871

3,621,450-

56,132,321--

56,132,321(Note)

330

8,103

330

8,103

-

-

8,103

(Note)

68,809,179

4,306,405

332

73,115,252

786,519

227,117

72,328,733

9,400

-

-

9,400

3,626

940

5,773

9,400

-

-

9,400

3,626

940

5,773

68,818,579

4,306,405

332

73,124,652

790,145

228,057

72,334,506

Structures intrust

Land in trust
Construction inprogress in trust
Subtotal
Intangible
assetsSoftwareSubtotal
Total(Note) The increase during period is mainly due to additional acquisition of a property (4,255,758 thousand yen in total).

4) Schedule of Other Specified Assets
Not applicable.

5) Schedule of Investment Corporation Bonds
Not applicable.

366) Schedule of Loans
Category

LenderDecrease
Increase
Balance atMaturity
Average
Balance at
beginning of during period during perioddate
end of period interest rate
(thousand(thousandperiod(Note 2)(thousand yen) (Note 1)
yen)
yen)
(thousand yen)Mizuho Bank Ltd.

1,331,000--

1,331,000

Sumitomo Mitsui Banking Corporation

929,000--

929,000

Development Bank of Japan, Inc.

796,000--

796,000

Mizuho Trust & Banking Co., Ltd.

509,000--

509,000

Sumitomo Mitsui Trust Bank Limited

465,000--

465,000

Shinsei Bank, Ltd.

385,000--

385,000

Resona Bank, Ltd.

385,000--

385,000

Mizuho Bank Ltd.

1,574,000--

1,574,000

Sumitomo Mitsui Banking Corporation

1,084,000--

1,084,000

Development Bank of Japan, Inc.

929,000--

929,000

Mizuho Trust & Banking Co., Ltd.

593,000--

593,000

Sumitomo Mitsui Trust Bank Limited

542,000--

542,000

Shinsei Bank, Ltd.

439,000--

439,000

Resona Bank, Ltd.

439,000--

439,000

Mizuho Bank Ltd.

972,000--

972,000

Sumitomo Mitsui Banking Corporation

716,000--

716,000

Development Bank of Japan, Inc.

614,000--

614,000

Mizuho Trust & Banking Co., Ltd.

392,000--

392,000

Sumitomo Mitsui Trust Bank Limited

358,000--

358,000

Shinsei Bank, Ltd.

324,000--

324,000

Resona Bank, Ltd.

324,000--

324,000

Mizuho Bank Ltd.

856,000--

856,000

Sumitomo Mitsui Banking Corporation

639,000--

639,000

Development Bank of Japan, Inc.

548,000--

548,000

Long-term Mizuho Trust & Banking Co., Ltd.
loans
Sumitomo Mitsui Trust Bank Limited

350,000--

350,000

319,000--

319,000

Shinsei Bank, Ltd.

294,000--

294,000

Resona Bank, Ltd.

294,000--

294,000

Mizuho Bank Ltd.

2,250,000--

2,250,000

Sumitomo Mitsui Banking Corporation

1,500,000--

1,500,000

Mizuho Trust & Banking Co., Ltd.

620,000--

620,000

Sumitomo Mitsui Trust Bank Limited

550,000--

550,000

Shinsei Bank, Ltd.

490,000--

490,000

Resona Bank, Ltd.

490,000--

490,000

Mizuho Bank Ltd.

950,000--

950,000

Sumitomo Mitsui Banking Corporation

800,000--

800,000

Development Bank of Japan, Inc.

2,000,000--

2,000,000

Mizuho Trust & Banking Co., Ltd.

620,000--

620,000

Sumitomo Mitsui Trust Bank Limited

550,000--

550,000

Shinsei Bank, Ltd.

490,000--

490,000

Resona Bank, Ltd.

490,000--

490,000

Mizuho Bank Ltd.

1,167,000--

1,167,000

Sumitomo Mitsui Banking Corporation

832,000--

832,000

Development Bank of Japan, Inc.

713,000--

713,000

Mizuho Trust & Banking Co., Ltd.

456,000--

456,000

Sumitomo Mitsui Trust Bank Limited

416,000--

416,000

Shinsei Bank, Ltd.

358,000--

358,000

Resona Bank, Ltd.

358,000--

358,000

Mizuho Bank Ltd.

-

4,300,000-

4,300,000

33,500,000

4,300,000-

37,800,000

Total

Remarks

0.24829%
Mar. 12,
Unsecured/(floating(Note 3)2021
Non-guaranteedinterest rate)

0.36969%
Mar. 12,
Unsecured/(fixed(Note 3)2022
Non-guaranteedinterest rate)

0.42346%
Mar. 12,
Unsecured/(fixed(Note 3)2023
Non-guaranteedinterest rate)

0.49096%Mar. 12,
Unsecured/(fixed(Note 3)2024
Non-guaranteedinterest rate)

0.27390%(floatinginterest rate)

Sep. 3,2022(Note 3)

Unsecured/Non-guaranteed

0.36200%(fixedinterest rate)

Sep. 3,2023(Note 3)

Unsecured/Non-guaranteed

0.32923%
Sep. 12,
Unsecured/(fixed(Note 4)2024
Non-guaranteedinterest rate)

0.22262%(floatinginterest rate)(Note 1) The average interest rate is a weighted-average figure during the fiscal period and is rounded to five decimal places.
(Note 2) If the maturity date is not a business day, the immediately following business day shall be the maturity date.
(Note 3) These funds are used for acquiring real estate or real estate trust beneficiary rights and accompanying expenses.
(Note 4) The funds are used to repay existing loans.

37

Use offunds

Oct. 1,
2021(Note 3)

Unsecured/Non-guaranteed

(Note 5) The total amounts of long-term loans to be repaid for each year within five years after the date of the balance sheet are as follows.
(Unit: thousand yen)

Long-term loans

Due within 1
year

Due after 1 to 2
years

Due after 2 to 3
years

Due after 3 to 4
years

Due after 4 to 5
years

9,100,000

11,500,000

9,600,000

7,600,000-

38